Transcript Key Question - Gonzaga College High School

Key Question
How is development defined
and measured?
© 2012 John Wiley & Sons, Inc. All rights
reserved.
How Is Development Defined
and Measured?
• Wealth does not depend solely on what is produced; it
depends in large part on how and where it is produced.
• A country that is developing is making progress in
technology, production, and socioeconomic well- being.
• Ways of measuring development fit into three major
areas of concern: development in economic welfare,
development in technology and production, and
development in social welfare.
© 2012 John Wiley & Sons, Inc. All rights
reserved.
How Is Development Defined
and Measured?
Gross National Income
• GNP is a measure of the total value of the officially
recorded goods and services produced by the
citizens and corporations of a country in a given
year, and includes things produced both inside and
outside the country’s territory.
• Gross domestic product (GDP), which
encompasses only goods and services produced
within a country during a given year.
© 2012 John Wiley & Sons, Inc. All rights
reserved.
How Is Development Defined
and Measured?
Gross National Income
• Gross national income (GNI): monetary worth of
what is produced within a country plus income
received from investments outside the country minus
income payments to other countries.
• The most common way to standardize GNI data is to
divide it by the population of the country, yielding
the per capita GNI.
• Formal economy: the legal economy that
governments tax and monitor.
• Informal economy: uncounted or illegal economy
that governments© 2012
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How Is Development Defined
and Measured?
Gross National Income
•
•
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GNI per capita masks extremes in the
distribution of wealth within a country.
GNI per capita measures only outputs (i.e.,
production). It does not take into account the
nonmonetary costs of production.
The limitations of GNI have prompted some
analysts to look for alternative measures of
economic development, ways of measuring the
roles that technology, production,
transportation, and communications play in an
economy.
© 2012 John Wiley & Sons, Inc. All rights
reserved.
How Is Development Defined
and Measured?
Gross National Income
• Other analysts focus on social welfare to measure
development dependency ratio: a measure of the
number of dependents, young and old, that each
100 employed people must support.
• A high dependency ratio can result in significant
economic and social strain.
• We can employ countless other statistics to
measure social welfare, including literacy rates,
infant mortality, life expectancy, caloric intake per
person, percentage of family income spent on food,
and amount of savings
per capita.
© 2012 John Wiley & Sons, Inc. All rights
reserved.
How Is Development Defined
and Measured?
Development Models
• Criticism of the development model:
• It does not take geographical differences
very seriously.
• The conceptualization of development has
a Western bias.
• It does not consider the ability of some
countries to influence what happens in
other countries.
© 2012 John Wiley & Sons, Inc. All rights
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Walt Rostow’s modernization model: assumes that all
countries follow a similar path to development or
modernization, advancing through five stages of
development:
1. The society is traditional, and the dominant activity
is subsistence farming.
2. Preconditions of takeoff: New leadership moves the
country toward greater flexibility, openness, and
diversification.
3. Takeoff: the country experiences something akin to
an Industrial Revolution, and sustained growth
takes hold.
4. Drive to maturity: Technologies diffuse, industrial
specialization occurs, and international trade
expands.
5. High mass consumption: high incomes and
widespread production
of many goods and services.
© 2012 John Wiley & Sons, Inc. All rights
reserved.
Key Question
How does geographical situation
affect development?
© 2012 John Wiley & Sons, Inc. All rights
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How Does Geographical Situation
affect Development?
• Development happens in context: it reflects what is
happening in a place as a result of forces operating
concurrently at multiple scales.
• Neocolonialism: the major world powers continue
to control the economies of the poorer countries,
even though the poorer countries are now politically
independent states.
• Structuralist theory holds that difficult-to-change,
large-scale economic arrangements shape what can
happen in fundamental ways.
© 2012 John Wiley & Sons, Inc. All rights
reserved.
Dependency Theory
•
Holds that the political and economic relationships between countries
and regions of the world control and limit the economic development
possibilities of poorer areas.
•
Dollarization: the country’s currency, the colon, was abandoned in
favor of the dollar.
Figure 10.6
San Salvador, El Salvador. A woman and young boy use
dollars to pay for groceries in El Salvador, a country that
underwent dollarization in 2001.
© AFP/News Com, Yuri Cortez.
© 2012 John Wiley & Sons, Inc. All rights
reserved.
Geography and Context
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Immanuel Wallerstein’s world-systems theory
Three-tier structure—the core, periphery, and
semiperiphery—helps explain the interconnections
between places in the global economy.
When core processes are embedded in a place,
wealth is generated for the people in that place.
Peripheral processes require little education, lower
technologies, and lower wages and benefits.
The semiperiphery exhibits both core and
peripheral processes, and semiperipheral places
serve as a buffer between the core and periphery in
the world-economy.
© 2012 John Wiley & Sons, Inc. All rights
reserved.
How Does Geographical Situation
affect Development?
Geography and Context
• World-systems theory makes the power
relations among places explicit and does
not assume that socioeconomic change will
occur in the same way in all places.
• World-systems theorists see domination
(exploitation) as a function of the capitalist
drive for profit in the global economy.
• World-systems theory is applicable at
scales beyond the state.
© 2012 John Wiley & Sons, Inc. All rights
reserved.